Palantir Technologies’ headquarters in Palo Alto, Calif.
David Paul Morris/BloombergPrivate market trading in Palantir Technologies shares accelerated after the first reports in June that the big software company was planning to go public, according to data from SharesPost, a company that makes markets in pre-IPO venture-backed companies.
Palantir will open for trading on Wednesday in a direct listing on the New York Stock Exchange under the ticker PLTR.
SharesPost has been transacting in Palantir shares since 2013, conducting $231 million in trades covering a total 38 million shares, the company said in an interview with Barron’s.
The bulk of the activity in 2018 through 2019 was in the range of $4 to $6 a share, but more recent activity has been in the range of $8 to $11, and trading volume has increased. Palantir suspended all private market trading in its shares on Sept. 1 ahead of the listing. The last private round in 2016 was priced above $11 a share, although that involved preferred shares with various rights above those of common shares.
The Wall Street Journal has reported that bankers expect the stock to open for trading at around $10 a share, close to recent transactions in the private market. At that price, the company would have a valuation of about $22 billion,
SharesPost CEO Greg Brogger notes that participation in private market trading is about evenly split among institutional investors and accredited individual investors. Private companies like Palantir set some restrictions on trading, and generally have a right-of-first-refusal to buy shares made available for sale. Brogger adds that one recent trend involves hedge funds “round-tripping”—buying the stock in the secondary market and then selling it again even before a company lists in the public market.
Brogger says his belief is that SharesPost is now the largest market for trading in late-stage private growth companies.
Palantir filings with the Securities and Exchange Commission show that there were 23.2 million shares of the company’s stock traded in 2019, at a volume-weighted average price of $5.42, and 50 million shares traded this year until suspension of trading on Sept. 1 at an average price of $6.02. That includes almost 36 million shares traded in the current quarter alone, at an average price of $6.45, with prices ranging from $4.17 to $11.50 a share.
Write to Eric J. Savitz at eric.savitz@barrons.com
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September 30, 2020 at 03:05AM
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Private Market Trading n Palantir Shares Surged Ahead of Direct Listing - Barron's
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